Nvidia Makes Whopping $3 Billion Bet on Meta

Meta Platforms (META) received orders for five times the shares in its $25 billion stock offering, priced at $625 per share. The sale is part of a $98 billion plan to fund AI expansion. Nvidia (NVDA) and AMD (AMD) were notable buyers, investing $3 billion and $1 billion, respectively. The offering indicates strong investor interest in Meta's AI strategy, despite dilution concerns.

Meta (META) and Nvidia (NVDA) expanded their partnership, with Nvidia investing $3 billion in Meta's new equity offering. The deal includes collaboration on AI models and infrastructure. Nvidia aims to strengthen its AI ecosystem, while Meta secures access to essential hardware. Nvidia also holds stakes in other AI-related companies, reinforcing its market dominance.

Anthropic, planning to list on Nasdaq as ANT, disclosed an IPO prospectus with potential compute and infrastructure costs of up to $567 billion. The company uses chips from Amazon (AMZN), Alphabet (GOOGL, GOOG), Nvidia (NVDA), and AMD (AMD). Chip stocks rallied, with NVDA up 2.4% and AMD up 2.8%, amid concerns about sustained data-center spending.

Meta Platforms plans to raise up to $100B in equity to fund AI expansion, including $22.5B in Class A stock and $12.5B in convertible preferred stock. Analysts note this may pressure free cash flow and dilute shares. Meta reported negative free cash flow of $2.12B in Q3. Wedbush sees equity financing as conservative amid credit market strain. Bank of America estimates the raise could dilute 2027 EPS by 6%. Meta expects to double infrastructure capacity in 2026.

AMD is investing $1 billion in Meta Platforms' equity offering, strengthening their partnership in AI technology. AMD's chips are used in Meta's AI infrastructure, and both companies are collaborating on AI software and hardware. The investment gives AMD a financial stake in Meta, but no additional terms were disclosed.

Meta Platforms plans to raise $95B, including $35B from a public offering with Nvidia, AMD, and Broadcom. Nvidia will invest $3B. Meta will issue Class C shares and split stock 2-for-1 in 2027. Both companies are expanding AI collaboration, with Nvidia supplying GPUs and CPUs. Meta's 2026 capex is projected at $135B-$145B. Nvidia's stock is up 0.92%, Meta's down 1.19%.